The Allahabad bench of the Customs, Excise & Service Tax Appellate Tribunal(CESTAT) allowed interest for period after 3 months refund of 19 crores of cenvat credit.
M/s HCL Technologies Ltd., the Appellant had filed a refund claim of Rs.19,00,00,000/- in terms of Rule 5 of Cenvat Credit Rules, 2004 read with Notification No.05/2006-CE(NT) dated 14.03.2006 for the period January, 2012 to March, 2012.
A show cause notice was issued to the appellant, asking them to show cause as to reject refund claim to the extent of Rs.23,39,587/- for the reasons that certain credit which has been claimed as refund claim under Rule 5 was not admissible to them. The appellant filed appeal before the Commissioner (Appeals), which has been disposed of the appeal by the impugned order.
The appellant has filed a refund claim of Rs.19 Crores and it is evident from the Order-inOriginal that refund of the same amount i.e. Rs.19 crores, has been allowed by the Assistant Commissioner, Customs, Noida and cheque for the same amount has been issued by the Assistant Commissioner to the appellant. When the amount as claimed and the refund claim filed has been sanctioned in toto where can there be any further dispute arisen, for the appellant to be aggrieved with.
Rule-5, as amended in 2012, does not require the refund claim filed by the appellant, to be examined determining admissibility of credit against which refund claim is filed. It only requires examination of the refund claim vis-à-vis the whole credit availed during the quarter and the total turnover and the export turnover.
After considering that amounts to be ineligible for refund. Assistant Commissioner by applying the formula as prescribed by Rule 5 has concluded that admissible refund to the appellant is same as the refund claimed by the appellant and has allowed the refund of entire amount as claimed by the appellant.
In absence of any proceedings under Rule 14 of Cenvat Credit Rules, 2004 observations recorded by the Assistant Commissioner cannot be taken as a denial of the credit. Even the Assistant Commissioner has nowhere said so she only find this amount to ineligible for refund, but even after holding them to be ineligible for refund has allowed the refund claim filed by the appellant in toto.
As the show cause notice issued involved in this appeal has not invoked the provision of Rule 14, therefore, any finding regarding admissibility of CENVAT credit in the impugned Order-in-Original, the impugned Order-in-Appeal or in this Final Order will not have any effect on any proceedings, if any, regarding the admissibility of Cenvat credit.
A two member bench of Mr P K Choudhary, Member (Judicial) and Mr Sanjiv Srivastava, Member (Technical) observed that The Appellants have claimed interest as per Section 11BB. As per Section 11BB interest is to be paid after expiry of three months from the date of filing the claim to the date of claim. In the present case refund claim was filed on 27.12.2012 the period of three months will be over on 26.03.2013. They would be entitled to the interest for the period beyond 26 March, 2013 to the date of payment i.e. 21.05.2013, which is about 55 days. To that extent appeal is allowed in favour of the appellant.
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